Federated States of Micronesia

Federated States of Micronesia
Federation Compact of Free Association


Motto Peace Unity Liberty
Anthem Patriots of Micronesia
Location of Micronesia

Capital	Palikir

Government	Presidential republic
President
- From 2007	Manny Mori

Legislature	Congress

History
- May 10, 1979	Autonomy
- November 3, 1986	Compact of Free Association effective
- July 10, 1987	Trust territory dissolved
- December 22, 1990	Security Council ratifies termination
- May 1, 2004	Compact of Free Association extended

Area	702 km²

Population
- 2009	111,000
Density	158.1/km²

GDP	2009 (PPP)
- Total	US$ 0.2 billion
- Per capita	US$ 2,664

Currency	United States dollar

Pacific Islands
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The Federated States of Micronesia is a federal republic in Micronesia. Under the Compact of Free Association it has entered into a relationship as an associated state with the United States. It comprises the states of Yap, Chuuk, Pohnpei and Kosrae.

Background

In 1979 the Federated States of Micronesia, a UN Trust Territory under US administration, adopted a constitution. In 1986 independence was attained under a Compact of Free Association with the US, which was amended and renewed in 2004. Present concerns include large-scale unemployment, overfishing, and overdependence on US aid.^[1]

Economy

Economic activity consists primarily of subsistence farming and fishing. The islands have few mineral deposits worth exploiting, except for high-grade phosphate. The potential for a tourist industry exists, but the remote location, a lack of adequate facilities, and limited air connections hinder development. Under the original terms of the Compact of Free Association, the US provided $1.3 billion in grant aid during the period 1986-2001; the level of aid has been subsequently reduced. The Amended Compact of Free Association with the US guarantees the Federated States of Micronesia (FSM) millions of dollars in annual aid through 2023, and establishes a Trust Fund into which the US and the FSM make annual contributions in order to provide annual payouts to the FSM in perpetuity after 2023. The country's medium-term economic outlook appears fragile due not only to the reduction in US assistance but also to the current slow growth of the private sector.^[2]